Selling ad campaigns: online algorithms with cancellations

We study online pricing problems in markets with cancellations, i.e., markets in which prior allocation decisions can be revoked, but at a cost. In our model, a seller receives requests online and chooses which requests to accept, subject to constraints on the subsets of requests which may be accepted simultaneously. A request, once accepted, can be canceled at a cost which is a fixed fraction of the request value. This scenario models a market for web advertising campaigns, in which the buyback cost represents the cost of canceling an existing contract. We analyze a simple constant-competitive algorithm for a single-item auction in this model, and we prove that its competitive ratio is optimal among deterministic algorithms, but that the competitive ratio can be improved using a randomized algorithm. We then model ad campaigns using knapsack domains, in which the requests differ in size as well as in value. We give a deterministic online algorithm that achieves a bi-criterion appro...

• Type: Conference
• Year: 2009
• Where: SIGECOM
• Authors: Moshe Babaioff, Jason D. Hartline, Robert D. Kleinberg
• Keywords: Competitive Ratio, Information Management, Randomized Algorithm, Seller Receives Requests, SIGECOM 2009